How Microsoft Could Win E3 Without Halo

The first time I reported on Halo, I sat in a room at GameSpot, watched the Bungie team set up for a demo, one that we were told would be great. As fans of the Marathon and Myth series, we anxiously piled into a room to see what Bungie had planned.

We were shown an early scene that looked like a high-resolution photograph. What Bungie’s Doug Zartman did next was one of the funniest moments I had seen in gaming; Doug moved the mouse and the ships started moving. The room, a tough room of gaming pros with short attention spans and a long history of being “not-so-wowed” by such demos, stopped talking. The game? Halo.

That was August 6, 1999 (my proof) and that demo was on a Mac. That same demo, not long after, was the darling of the Apple fanbase and a way around Apple’s confusing game strategy (cough… Pippen and GameSprockets). And then the impossible happened. Microsoft bought Bungie. Might the impossible be just the thing that gets gamers to the Xbox One and not the PlayStation 4?

The Point

Microsoft’s recent showing of the Xbox One failed to connect with gamers. I suspected, and had already written, that the intent of the event was to connect with dads (read Xbox One: The All-In-One Dad Box), a group with the disposable capital, a need for fast-switching media features, integrated business features like Skype, access to a new Madden and a new kid-friendly Kinect. CNET’s Dan Ackerman agreed.

Gamers, in a word, were pissed. Where’s Halo 5? And yet, it gave a hint that was missed by many, Microsoft is investing $1 billion dollars in 15 new games, several of those being new IP. While some of that money will go to the internal studios, it is also an investment in studios that might create the next Halo. This, I suspect is just a part of what Microsoft might be planning for its next media event at E3 2013.

Yet, Microsoft needs to make the right investment, pen the right deals and ensure that it curates Xbox One-only games. Games that will get gamers to leap to Xbox One on day one, despite price. Two names, though controversial, stand out. And while I haven’t been part of the global gaming industry for a while, either option would win.

The Options

Option 1: Epic. Given the recent departure of Cliff Bleszinski, Epic is in transition. Epic’s still a formidable force with the Xbox-exclusive Gears of War series and the broadly used Unreal game engine. Purchasing Epic would give Microsoft the Gears of War IP, one that it might merge into the media empire that it has been building for Halo under 343 Industries.

Making the Unreal engine Microsoft exclusive would ease current Unreal engine game makers to the new console and would give Microsoft massive strategic leverage in its licensing deals as well. It would take years for developers to create competition for Unreal, years that would make Xbox One huge.

Option 2: Valve. Nothing screams more hardcore than Valve, a company that owns its own IP, IP that would sell consoles. While the company is branching out in a new direction with its upcoming hardware platform (although more reserved now), gamers have been extremely vocal in their need for a new iteration in the Half-Life series. With Microsoft ownership, Valve (founded by former Microsoft employee Gabe Newell) might be asked to create Half-Life 3, a new Left 4 Dead Counter-Strike, and Portal 3 (and hopefully Dota). And Valve’s gaming services and distribution engine, Steam, would bring loads of core gamers to Microsoft’s console in droves, a clear way to differentiate cores from casuals.

And after Newell’s announcement that he was working with J. J. Abrams on transforming Portal or Half-Life onto the silver screen, this might also make it interesting for Microsoft’s 343 Industries’ growing media power.

I’ll admit that either option is wildly speculative. Yet, Microsoft has pulled such a move before. Every company has a price. I first played Halo on a Mac, what console did you play it on?